Post budget confidence boost needed

Chief Economist of Master Builders Australia Peter Jones explains that the 5.6 per cent drop in total dwellings approved, seasonally adjusted in April, is largely due to a 14 per cent decline in approvals for other dwellings (including apartments), which followed previous strong growth in units and apartments over the past 12 months.

According to Peter Jones, the multi-unit sector has enjoyed a stellar run in recent months and therefore the fall back is not entirely unexpected. However, it is in contrast to the small drop in approvals for detached houses of 0.3 per cent in April to a level still 16.5 per cent above its position at the same time last year.

He commented that builders are confident the slight cooling in the rapid rise in approvals in recent months sets the scene for a more sustainable upswing without risking input cost inflation.

According to Peter Jones, while the latest building approvals data does not foreshadow the end of the upturn in residential building, the Master Builders calls on the Government to continue implementation of measures to grow the economy to ensure that the Budget’s structural repair initiatives do not unduly dampen sentiment.